Stopping the Compact from Becoming a Trojan Horse

by Nick Dranias, Goldwater Institute

Tea Parties across the country have been championing the idea of using interstate compacts—which are basically legal agreements among the states—as a way of delaying the roll-out of President Obama’s so-called Patient Protection and Affordable Care Act, also known as Obamacare. The most popular compact idea, the “Health Care Compact,” has already been adopted by Texas, Utah, Missouri, Indiana, South Carolina, Oklahoma and Georgia. It promises to move “the responsibility and authority for regulating health care from the federal government to the states.”

There’s only one problem. Section 1333 of the federal health care law specifically anticipates what it calls “Health Care Choice Compacts” and prescribes how such compacts must be organized, allowing them to exist only if they replicate nearly all of Obamacare’s most burdensome and costly regulations. In short, this little known provision could easily co-opt and subvert the growing Health Care Compact movement to ensure federal law continues to govern even the states that join the compact.

It is critically important that all health care compact initiatives explicitly reject section 1333 of the federal health care law. This is the only way for states to ensure that their compact will actually serve as a genuine vehicle for preserving state sovereignty and freedom of choice in health insurance. Any health care compact initiative that fails to do risks becoming a Trojan Horse for federal domination of health insurance markets.

Compacts are a promising tool for protecting states against federal overreach, but we have to get the details right and we can’t afford to let this issue go unaddressed simply because some states have already adopted the Health Care Compact. We can fix it in the states that already have, and move forward on sounder footing in states that haven’t.

Learn more:

Goldwater Institute: Ten Reasons Why Arizona Must Reject Health Insurance Exchanges

Health Care Compact: Website

U.S. Government: Patient Protection and Affordable Care Act, Section 1333 (PDF)